Tom Webster, writing and speaking

The Three Essential Processes Of Marketing

Added on by Tom Webster.

A couple of weeks ago, I was a guest lecturer for a couple of Marketing classes here at the University of North Carolina. Ostensibly, I was there to talk about market research as a practice (and as a career), but the discussion soon expanded when it was apparent there were a number of young entrepreneurs in the class. I had a memorable exchange with one student who was a wedding photographer in one geographic market, but had chosen to enter another, extremely crowded market simply because there were so many weddings there. With so many other photographers competing in that market, he wanted to know how I could help him sell his stuff with market research. My short answer was: maybe I can't. The desire to enter a market does not grant you access to do so, no matter how strong that desire. Maybe he shouldn't have entered that market without a clearer sense of what that market was - and wasn't - getting from its current crop of vendors. My somewhat longer answer, however, was this: what you are asking me is not a marketing question. It's a sales question. Because you haven't identified the needs and wants of that market, or customized your offering to provide benefits unique to that market, you are basically down to execution - i.e., sales.

It struck me as I was driving home from class that so much of what we see in social media that calls itself "marketing" is really just sales. Think about this useful definition from the Charted Institute of Marketing the next time you apply yourself to a "marketing" challenge: "Marketing is the management process responsible for identifying, anticipating and satisfying customer requirements profitably." To me, those three elements (identifying, anticipating and satisfying) are the three essential processes of marketing, and yet I see so much selling in the guise of "marketing" that ignores all three.

Identifying

In my world, we use a lot of comparative research to identify customer wants, needs and desires. We start with a known quantity (some feature, benefit, communication, etc.) and ask quantitative questions: what is it? Who likes/dislikes it? How many people engage in this behavior? Identifying customer needs through comparative research does exactly what it says on the tin - it compares your ideas to existing ideas, and measures where they come up short, and where they exceed the norms.

The important aspect of identifying customer requirements is that you are dealing with what a customer knows he or she wants. When GM launched Saturn in the U.S., they did a great deal of comparative research to identify what aspects of the car buying process were painful by asking lots of car buyers what they knew they liked and didn't like about buying a new car. That new car smell likely received high marks, but the actual process of negotiating for and physically purchasing a car was horrible. They identified a customer need - to make the car buying process hassle-free - and designed their entire line around that concept.

By the way, if you ask your database what kinds of products or services they would like you to provide, and you get a few answers, congratulations - you've identified the needs of a few individuals. Do you have the processes in place to extrapolate to a larger market? Remember - the plural of 'anecdote' is not data.

Anticipating

Anticipating customer needs is the fun bit for me, since (as a market researcher) I get to do a little "blue sky" thinking and exploratory research, both in terms of strategy and in how I can provide decision support for my clients. Anticipating customer needs, as opposed to identifying them, means finding out what your customers desire when they themselves can't name those desires. This central marketing process depends upon careful listening and observation, because a customer can never tell you that they are passionate about something they've never seen, touched or even heard of.

Lexus launched here in the U.S. precisely because they had the processes in place to anticipate the American consumer. Toyota conducted a fair amount of observational research of affluent car buyers to see what their real pain points were - not in terms of how many cylinders their engines should be, or how many air bags were expected (those are good need identification questions), but how to improve the quality of life of their potential customer base.

In a luxury car market dominated by German manufacturers, with their credible claims to performance, Lexus carefully observed that affluent Americans were moving further and further from their workplaces in order to purchase larger, more comfortable homes. This resulted in longer, exurban commutes, earlier wake-up calls and less time to deal with domestic stress and issues. Lexus anticipated the desires of its target consumers and focused their launch on one word and one word only: quiet. They engineered their product to be the quietest car on the road, and all of their launch marketing was laser-focused on communicating this to potential buyers. It was a "need" that a customer would not have necessarily articulated when asked about the features they would like in a new car, but this anticipated benefit was music to the ears of stressed-out, affluent commuters - and the rest is history.

Satisfying

Customer satisfaction is the third integral process of marketing, and consists of the steps you take to make sure people love your product, come back for more, and tell a friend in the process. It is part of marketing's "circle of life" (with apologies to Elton John and Simba) in that customer loyalty often begets evangelism, which leads to new trial and usage opportunities with a whole new customer. Ensuring that you are satisfying your customers and encouraging loyalty can be ascertained through survey research or even by social media monitoring, if you know what you are doing.

Satisfaction measures can be used to improve an existing product, or even to launch an entirely new product or service. We use metrics like the Net Promoter Score or other measures of consumer loyalty to gauge the passion customers have about your offerings, and sometimes whole new categories can open up based purely on an observed "passion gap." To me, Richard Branson is the master at this. What Branson has done in the past is to identify services that no one likes, and then figure out a way to make people passionate about them. By attaching the Virgin brand - and delivering on its brand promise - to things like financial services, Branson excels in crafting offerings that shake up moribund categories and create raving fans.

Virgin Atlantic is one of the best examples of this practice: When VA launched its first flight, it did so based upon one guiding purpose: that most people hated the airline industry. For some this would be a deterrent to entry, but Branson seeks out "commodity" businesses that nobody really likes, and structures his offering to deliver one one metric: customer satisfaction. Today we have airlines like JetBlue and Southwest treading the same turf, but Branson is the master of the craft.

The Three Processes In Action

At this point, you are either reassured or horrified. In a healthy, marketing-centric enterprise, all three processes are robust and continuous, ensuring that your company builds upon its past, delivers its present offering with excellence, and is ready with the next, new thing when the old is past its sell-by date. Having all three in place is the best way to create sustained value in the marketplace, while operating without these processes is a surefire ticket to obscurity, despite whatever short-term tactical success you might have had selling a product or service built on shaky ground.

The fundamental question of the exercise is this: do you have all three processes in place? If not, why not? For some, it is that they are afraid of the answers. What I've learned over my career is that it is precisely the answers you don't want to know - the uncomfortable, inconvenient truths of your market - that provide the greatest potential to break through with an offering that delights customers profitably, which is the best, non-technical definition of marketing that I know.

Finally, what all of these processes do best is to get you to ask questions. Questions make things better. Questions create clarity, and ultimately help you focus on exactly what you are selling and how you will sell it. Questions that help you identify, anticipate and satisfy customers' needs, wants and desires are the healthiest questions in the world. Never stop asking them.

So, consider this a good time to examine these processes - are you missing any or all of them? Are they working for you?